Microsoft has laid out plans to become a bigger force in the market for virtualization software, stepping up its assault on established leaders such as VMware.

The plans announced Monday include the acquisition of a start-up company, Calista Technologies, whose graphics technology is designed to improve the end-user experience for people who access their Windows desktop remotely from a server, Microsoft said.

The company also loosened some of its licensing terms related to virtualization. Consumers who use the Home Basic and Home Premium editions of Windows Vista will now be able to run those OSes in a virtualized environment, Microsoft said. It also announced new licensing rates for corporate users.

Finally, Microsoft extended its partnership with Citrix Systems to make that company’s Xen virtualization software work better with Microsoft’s server and desktop software, it said.

Virtualization technologies separate the software on a computer from its underlying hardware, allowing it to be deployed in more flexible ways. Virtualization can allow multiple operating systems to run on one computer, for example, or allow application workloads to be shifted between computers more easily to improve hardware utilization.

The technology has been around for decades but was popularized in server environments recently by VMware and others. More recently, Apple introduced virtualization for its Macintosh desktops so that users can run both the Mac OS and Windows on the same machine.

Microsoft has not been a significant player in virtualization, but it hopes to change that with its announcements this week. It plans to discuss the changes at its Virtualization Deployment Summit, a two-day event for 300 of its customers and partners that starts Tuesday.

It argued that the virtualization market remains open for newer players like itself.

“Very few customers are able to reap the benefits of virtualization today,” Bob Muglia, senior vice present of Microsoft’s Server and Tools Business, said in a statement. “We estimate that less than five percent of companies are utilizing virtualization technology because it is simply too cost-prohibitive and complex.”

Microsoft’s strategy will be to offer a full range of virtualization products, including desktop, server and management software, and do so at a competitive price, Muglia said.

Customers with the Home and Home Premium editions of Vista can now run them as a guest operating system on a virtual machine, the company said. Among other things, that should mean that Apple Mac users who want to run Vista alongside the Mac OS can now do so without having to buy a more expensive version of Windows.

For businesses, customers who subscribe to Microsoft’s Software Assurance maintenance program can now get an annual subscription to Microsoft’s desktop virtualization software for US$23 per desktop, the company said.

Citrix is developing a software tool that will make it easier for customers to transfer virtual machines between Citrix XenServer and Windows Server 2008 Hyper-V. A test version of the tool will be available in the second quarter, and the final version will be released along with Hyper-V, Microsoft said.

The technology from Calista aims to improve the experience for people who access their Windows desktops remotely from a server. It allows people to view multimedia content on a PC or thin client without the media player or software codecs they would normally need installed.

Microsoft will add Calista’s graphics technology to future virtualization products, it said. Calista, of San Jose, California, is now a Microsoft subsidiary.